Why Singapore’s Money Authority Halted ICO And Ordered Refunds

The high risks that accompany ICOs have forced countries’ regulators to pay close attention to them and crypto exchanges. There may be opportunities in these new industries but they cannot avoid rule and regulation. Singapore’s MAS (Monetary Authority of Singapore) took drastic measures and even forced one ICO to stop its sales and refund its investors.

ICOs are under pressure from regulators

Due to the risks and challenges that each ICO (Initial Coin Offering) brings, regulators from various countries have increased their efforts to force them to abide by the rules. This is a problem that goes far beyond the borders of the US, and nearly every country in the world is engaged at some level.

Illicit projects are an especially big concern, and the SEC has been hunting such projects down for months. Some were even shut down due to violations of the laws regarding securities.

One such incident was just reported in Singapore, where its MAS had to stop various ICOs for regulatory violations. One project in particular has had to be completely shut down and the team ordered to return the investments to the ICO’s participants. According to reports, the ICO violated several rules, including those regarding futures contracts and securities.

ICOs need to follow the rules

The ICOs held in Singapore are obligated to contact MAS and notify the authorities before issuing a token sale, so that it can be properly established whether or not the tokens are considered securities. Violations made by this ICO are obviously serious enough for MAS to start investigating the exchanges associated with it as well.

So far, MAS has warned up to eight exchanges and trading platforms, and it would seem that the exchanges in question will have to remove the ICO token, which will have considerable consequences for stakeholders and investors alike.

Lee Boon Ngiap, the Assistant Managing Director of MAS, stated that the number of ICOs and crypto exchanges has been on the rise lately. MAS would not abuse its power and restrict those who are doing legal business, but those who are violating the regulations will be taken action against. This is especially important for the public to know since MAS cannot protect the individual investors if they deal with unregulated cryptos.

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Ali is a freelance journalist, having years of experience in web journalism and marketing. He contributes to various online publications. With a master degree, now he combines his passion for writing about cybersecurity, cryptocurrencies, and technology. When he is not working, he loves traveling and playing games.